After a natural disaster like Hurricanes Irma and Maria, many homeowners and business property owners may face significant financial hardships, manifested in an inability to make mortgage payments. Fortunately, there are certain foreclosure protections available for property owners in the U.S. Virgin Islands.

The following is an overview of some of the options available for property owners in the wake of these incredibly destructive storms.

Federal Housing Administration (FHA) loans

The U.S. Department of Housing and Urban Development (HUD) offers a 90-day moratorium on any foreclosures of FHA-insured mortgages after natural disasters. This moratorium applies under the following conditions:

The property is within the boundaries of a presidentially declared disaster area

The property was directly affected by that disaster

The time period for this moratorium can be extended if the disaster is especially severe or affected a large area. If your property was not damaged by the disaster, but the storm did have a financial impact, you could still qualify for this moratorium if you can prove this negative impact.

Your loan servicer can provide you with more information and tell you if your loan is insured by the FHA.

Fannie Mae and Freddie Mac loans

Fannie Mae and Freddie Mac offer a suspension of foreclosure sales within the 90 days following a natural disaster if the property is located in an area that has been federally designated as a disaster zone. This, of course, only applies to loans that Fannie Mae or Freddie Mac own.

Veteran’s Affairs (VA) loans

The U.S. Department of Veteran’s Affairs encourages all holders and servicers of loans to establish 90-day moratoriums on initiating new foreclosures after disasters and help all individuals affected by these disasters by offering loan modifications or forbearance.

Other types of relief

Many individual U.S. Virgin Islands mortgage lenders and servicers provide other forms of relief from foreclosure by being more flexible in disaster situations. Some common examples of relief include:

Loan modifications (usually 90 days upon application)

A temporary reduction or suspension of payments

A waiver of late payments

Suspension of reporting instances of delinquency to credit bureaus

The Federal Emergency Management Agency (FEMA) also offers financial assistance to any individuals or families whose property has been destroyed or severely damage as a result of a federally declared disaster. This financial assistance can help people make mortgage payments or necessary repairs.

For more information on the wide variety of options available to you to get financial relief and avoid foreclosure after the hurricanes, consult a trusted U.S. Virgin Islands attorney today. It’s our mission to help our clients through these difficult times for our community.

Tom Bolt is Managing Attorney of BoltNagi, a widely respected and well-established business and corporate law firm serving individuals and organizations throughout the U.S. Virgin Islands.

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